What about exotic or over-the-counter (OTC) contracts
What about exotic or over-the-counter (OTC) contracts?
Expert
Exotic or over-the-counter (OTC) contracts are not traded actively; they may be exceptional to you and your counterparty. These instruments should be marked to model. And it obviously raises the question of that model to use. Generally in this context the ‘model’ implies the volatility, whether in FX or fixed income and equity markets. So the question about that model to use becomes a question about that volatility to use. Along with credit instruments the model frequently boils down to a number for risk of default.
How are foreign exchange transactions among international banks settled?The interbank market is network of correspondent banking relationships, along with large commercial banks maintaining demand deposit accounts along with one another, known a
hi the link is https://myelearning.cavehill.uwi.edu/login/index.php login: 411002468 pass- ls@2014 go into financial management 2 course, the quiz will be from week 1-5 lecture
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